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Spring 2013 Students, Stephanie Schauer

Balancing pet care and your checkbook: Is pet insurance worth the investment?

By Stephanie Schauer

When Declan Desmond’s girlfriend received a bouquet of lilies from a friend in September 2011, he didn’t know that gift would end up costing him $1300 in veterinary bills. His cat Scout, 4, required emergency care after ingesting pollen from the flowers, which potentially fatal to cats. After an overnight stay at a pet animal hospital with rounds of  IV drips and medicine, Scout’s life was saved. However, the total bill did not include the follow-up appointments.

Desmond and his cat Scout, who almost died from ingesting pollen.

Desmond and his cat Scout, who almost died from ingesting pollen.

Before the vet provided care for the cat, she consulted Desmond first to discuss the breakdown of how much it would cost and how he planned to pay for the services. Desmond recalls the conversation added additional stress to his already high emotions.

“It was the last thing I needed,” he said.

Desmond did not have pet insurance for Scout or any other way to pay the bills. He applied for CareCredit, a credit card installment plan used to cover health care costs upfront for both people and pets.

Desmond, 30, attends San Diego State University full-time and works an average of 32 hours each week for $12 an hour as an overnight valet attendant at a local casino resort. He struggles to pay the last $200 of the vet bill from more than a year ago and has received frequent phone calls from a third party collector agency.

“I knew it would put me further into the hole, but I also knew I couldn’t let the cat die,” Desmond said.

Pet costs continue to climb

Pet owners in America spent nearly $25.2 billion on veterinary medicine, medical supplies and care between 2011 and 2012, according to the American Pet Products Association, and costs continue to increase.

Patient Cali was being prepped for surgery in the care of trained veterinary assistants and vets at Cuyamaca Animal Hospital.

Patient Cali was being prepped for surgery in the care of trained veterinary assistants at Cuyamaca Animal Hospital.

According to the Bureau of Labor Statistics, veterinary services have risen an estimated 79 percent in a decade from 2000 to 2010 and veterinary fee inflation has averaged 5.6 percent per year since 2000.

San Diego Humane Society President and CEO Dr. Gary Weitzman said the reasons for the increase in costs are complex, but the rising fees are “changing the entire face of veterinary medicine.”

Advanced technologies and better treatments, such as MRIs, pacemakers and nuclear medicine, contribute to the rising costs and “the price tag attached to it is beyond a lot of people’s reach,” according to Weitzman.

And with more treatment options available, the decision on whether or not to treat a pet does not become easier.

“People are optimists and think that nothing bad is ever going to happen,” said Weitzman, “but it can really happen and it’s devastating when you’re faced with a bill for an unexpected trauma or disease.”

Can pet insurance help?

According to the North American Pet Health Insurance Association, nearly one million pets are insured and out of the one million and out of the one million:

Types of Pets Insured Pie Chart

However, comparing the number of pets insured to the overall percentage of cats and dogs owned in the U.S. is a startling disconnect.

Based on statistics compiled from the American Pet Products Association’s 2011-2012 National Pet Owners Survey, there are approximately 78.2 million owned dogs and 86.4 million cats owned in the U.S. and of those only one million of dogs, cats and other pets (including reptiles and small pocket animals) are insured leaving other pets and their owners vulnerable to unexpected veterinary costs.

“We don’t condemn anyone, except those that don’t try to take care of their pets at all,” Weitzman said.

Those unexpected pet costs can be covered upfront using CareCredit and similar companies; however, there is a time limit on when customers need to pay the debt, which is usually within a 12-month time period. Interest begins to collect at fairly high rates after the deadline passes and the bill is still not paid in full. If pet owners want to protect their pets and their bank accounts, there is another option.

Pet insurance 101

Choosing the right policy and coverage plan can be confusing for pet owners. A pet insurance comparison website, Pet Insurance Review, can help customers decide.

A screenshot of petinsurancereview.com

A screenshot of petinsurancereview.com

According to the website, there are a few things to keep in mind when choosing a pet insurance plan.

First, understand that not all insurance plans are created equal. Some insurance plans cover accidents, but not illnesses. Do your homework.

There are three levels of coverage:

  • Accident Only

  • Accident and Illness

  • Accident, Illness and Wellness

Each level differs in premium price depending on the stats of the pet including breed, age and weight and pre-existing conditions are not covered by new policies.

Second, it’s important to not look at the price, because in most cases, cheaper policies provide less coverage.

Third, with insurance, pet owners can use any veterinarian they want, because all pet insurance companies will allow claims from any licensed veterinarian.

Next, before signing a name on the dotted line or providing an electronic signature, remember this: the bill must be paid out-of-pocket first and then a claim must be submitted in order for the insurance company to reimburse the costs.

The emotional value of pet insurance

Pet insurance was created to help protect people from large, unexpected vet bills. For San Diegan Edwin Tactay, 33, making monthly payments for insurance serves as “peace of mind.” Tactay’s Dachsund Terrier Roxy only has one health problem related to dental hygiene called “small dog syndrome.” This happens when a small-sized canine has bigger teeth than it has room for in its mouth causing food and plaque to build up in the back of the mouth causing bad breath. Her owner takes her in to the vet monthly to have her teeth cleaned, which is covered by Tactay’s pet insurance provider Vanfield, which is available through pet supply store PetSmart.

However, for pet owners like Michelle Francescotti having an insurance plan for her two cats has meant the difference between saving one of her “kid’s’”  life and saying “good-bye.”

VIDEO: Pet owner Michelle Francescotti believes having insurance for her two cats has made all the difference in not only their lives, but hers as well.

Francescotti pays $24 per month for each cat’s insurance policy through PetPlan and is reimbursed ninety percent for regular vet visits, medication and emergency room visits and eighty percent for a vet specialist visit like an oncologist. Since she signed up for these policies about three years ago, she has been reimbursed more than $10,000 for her cat William and more than $2,000 for her cat Penny.

No matter which species the pet is, money is often a deciding factor when it comes to making a decision between seeking treatment for a beloved pet or abstaining from medical procedures, because the cost is out of reach when out of pocket.

“It’s very hard to not walk in someone else’s shoes and understand what that cure is going to cost them,” Weitzman said.

Dr. Lori Martin of Cuyamaca Animal Hospital in Santee understands how the costs of pet care often deter pet owners from seeking treatment for their animals and admits to having similar feelings when caring for her own, as well. However, pet owners shouldn’t discount taking their pets in, because vets like Martin put all the options out on the table.

SLIDESHOW: Dr. Lori Martin of Cuyamaca Animal Hospital in Santee shares what pet owners can expect when they come in to seek treatment for their pet(s).

The unbreakable bond

Although the price of vet visits, consultations and surgical procedures have increased, the bond is still strong between Americans and their pets, according to the American Veterinary Medical Association.

  • 66 percent of dog owners consider their dogs family members.

          - Up from 53.5 percent in 2006.

  • 56.1 percent of cat owners consider their cats family members.

          - Up from 49 percent in 2006.

Dr. Weitzman includes himself in those statistics and values the relationship between owners and their pets.

“We have a bond with animals that is unique and secure and absolutely beautiful,” he said.

The emotional investment people often make in their pets can eventually be turned into a long-term financial investment, as well. When it comes to making a decision in a veterinary hospital when facing a life or death decision for a pet, it could all come down to money.

“Every decision should be rational, but I don’t think you can ever, ever, ever take the emotion out of it,” Weitzman said.

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